Name: Ross Stores Inc. (NASDAQ:ROST) | Cash Flow Statement
Creator: Stock Analysis on Net

Cash Flow Statement

The cash flow statement provides information about a company cash receipts and cash payments during an accounting period, showing how these cash flows link the ending cash balance to the beginning balance shown on the company balance sheet.

The cash flow statement consists of three parts: cash flows provided by (used in) operating activities, cash flows provided by (used in) investing activities, and cash flows provided by (used in) financing activities.

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Ross Stores Inc., consolidated cash flow statement

US$ in thousands

12 months ended:	Jan 29, 2022	Jan 30, 2021	Feb 1, 2020	Feb 2, 2019	Feb 3, 2018	Jan 28, 2017
Net earnings	1,722,589)	85,382)	1,660,928)	1,587,457)	1,362,753)	1,117,654)
Depreciation and amortization	360,664)	364,245)	350,892)	330,357)	313,163)	302,515)
Loss on early extinguishment of debt	—)	239,953)	—)	—)	—)	—)
Stock-based compensation	134,217)	101,568)	95,438)	95,585)	87,417)	74,554)
Gain on sale of assets	—)	—)	—)	—)	(6,328)	—)
Deferred income taxes	15,775)	(27,812)	32,009)	31,777)	(34,903)	(8,703)
Merchandise inventory	(753,291)	323,357)	(81,897)	(108,707)	(128,849)	(93,782)
Other current assets	1,420)	(39,406)	(10,315)	(30,789)	(31,796)	(928)
Accounts payable	135,311)	938,837)	114,153)	110,483)	41,322)	83,085)
Other current liabilities	198,595)	171,444)	30,513)	37,080)	49,068)	76,676)
Income taxes	(44,579)	39,806)	(35,239)	3,706)	—)	—)
Operating lease assets and liabilities, net	7,647)	13,669)	15,631)	—)	—)	—)
Other long-term, net	(39,499)	34,890)	(567)	9,728)	29,431)	7,780)
Change in assets and liabilities	(494,396)	1,482,597)	32,279)	21,501)	(40,824)	72,831)
Adjustments to reconcile net earnings to net cash provided by operating activities	16,260)	2,160,551)	510,618)	479,220)	318,525)	441,197)
Net cash provided by operating activities	1,738,849)	2,245,933)	2,171,546)	2,066,677)	1,681,278)	1,558,851)
Additions to property and equipment	(557,840)	(405,433)	(555,483)	(413,898)	(371,423)	(297,880)
Proceeds from sale of property and equipment	—)	—)	—)	—)	15,981)	—)
Decrease in restricted cash and investments	—)	—)	—)	—)	2,310)	3,388)
Proceeds from investments	—)	—)	517)	3,489)	40)	1,729)
Net cash used in investing activities	(557,840)	(405,433)	(554,966)	(410,409)	(353,092)	(292,763)
Issuance of common stock related to stock plans	25,069)	23,534)	22,209)	20,112)	18,468)	18,539)
Treasury stock purchased	(57,345)	(45,222)	(60,665)	(54,384)	(45,433)	(43,321)
Repurchase of common stock	(649,997)	(132,467)	(1,275,000)	(1,075,000)	(875,000)	(700,000)
Dividends paid	(405,123)	(101,404)	(369,793)	(337,189)	(247,526)	(214,640)
Net proceeds from issuance of short-term debt	—)	805,601)	—)	—)	—)	—)
Payments of short-term debt	—)	(805,601)	—)	—)	—)	—)
Net proceeds from issuance of long-term debt	—)	2,965,115)	—)	—)	—)	—)
Payments of long-term debt	(65,000)	(775,009)	—)	(85,000)	—)	—)
Payments of debt extinguishment and debt issuance costs	—)	(232,688)	—)	—)	—)	—)
Excess tax benefit from stock-based compensation	—)	—)	—)	—)	—)	23,331)
Net cash provided by (used in) financing activities	(1,152,396)	1,701,859)	(1,683,249)	(1,531,461)	(1,149,491)	(916,091)
Net increase (decrease) in cash, cash equivalents, and restricted cash and cash equivalents	28,613)	3,542,359)	(66,669)	124,807)	178,695)	349,997)
Cash and cash equivalents, and restricted cash and cash equivalents, beginning of year	4,953,769)	1,411,410)	1,478,079)	1,353,272)	1,111,599)	761,602)
Cash and cash equivalents, and restricted cash and cash equivalents, end of year	4,982,382)	4,953,769)	1,411,410)	1,478,079)	1,290,294)	1,111,599)

Based on: 10-K (reporting date: 2022-01-29), 10-K (reporting date: 2021-01-30), 10-K (reporting date: 2020-02-01), 10-K (reporting date: 2019-02-02), 10-K (reporting date: 2018-02-03), 10-K (reporting date: 2017-01-28).

The financial trajectory of Ross Stores Inc. between 2017 and 2022 is characterized by consistent operational cash generation, a strategic increase in capital expenditures, and a significant shift in liquidity management during the 2021 fiscal year. Despite a sharp contraction in net earnings during the period ending January 30, 2021, the company maintained a robust capacity to generate cash from its core operations.

Operating Cash Flow and Earnings Quality: Net cash provided by operating activities demonstrated a general upward trend, rising from 1.56 billion USD in 2017 to a peak of 2.25 billion USD in 2021, before moderating to 1.74 billion USD in 2022. A notable divergence occurred in 2021, where net earnings fell to 85.4 million USD, yet operating cash flow reached its highest level. This was primarily driven by a substantial increase in accounts payable (938.8 million USD) and non-cash adjustments, including a loss on early extinguishment of debt. The 2022 period saw a significant cash outflow for merchandise inventory totaling 753.3 million USD, indicating a strategic build-up of stock.
Investing Activities and Capital Deployment: Investment activity was dominated by consistent expenditures in property and equipment. Additions to property and equipment grew from 297.9 million USD in 2017 to 557.8 million USD in 2022, representing a steady commitment to physical store expansion and infrastructure. Net cash used in investing activities closely mirrored these capital expenditures, remaining consistently negative across the six-year period, which reflects a sustained growth strategy.
Financing Activities and Capital Allocation: The company followed an aggressive shareholder return policy for most of the period. Treasury stock purchases and common stock repurchases were significant, peaking in 2020 at approximately 1.34 billion USD combined. Dividends paid also showed a steady increase, rising from 214.6 million USD in 2017 to 405.1 million USD in 2022. A pivotal shift occurred in 2021, when the company pivoted from returning capital to securing liquidity, issuing 2.97 billion USD in long-term debt, which offset the typical outflows for buybacks and dividends.
Liquidity and Cash Position: The total cash and cash equivalents position expanded significantly over the analyzed timeframe. Starting at 1.11 billion USD in 2017, the balance grew to 4.98 billion USD by January 29, 2022. This accumulation was accelerated by the debt issuance in 2021, providing a substantial liquidity buffer. The overall trend indicates a transition from a lean cash position to a highly liquid balance sheet, allowing the company to sustain high levels of capital expenditure and shareholder distributions simultaneously.

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